The author is a Forbes contributor. The opinions expressed are those of the writer.

Loading ...

Loading ...

This story appears in the {{article.article.magazine.pretty_date}} issue of {{article.article.magazine.pubName}}. Subscribe

I am struck by a major disconnect between the stories of real-life CEOs and theories of leadership. The theories of leadership never seem to talk about necessary expertise in running companies. Most of the thinking seems to revolve around people skills. Two skillsets in particular, financial and technical, are barely ever talked about. Yet, when you read the actual stories of famous CEOs and business leaders, you realize that invariably they had at least one or the other. In rare cases, both. And we're not talking about ordinary skill levels. We are talking exceptional on one or both of those dimensions. Equally, a lot of them have famously lacked people skills.

If they only had people skills, they've generally been forgettable CEOs who at best kept the ship sailing on a straight course, between more active navigator-CEOs. At worst, they've buried their head in the sand with respect to important environmental developments, and let successors deal with the consequences of their not-leading.

This goes way back. The first CEO in the modern sense, Cornelius Vanderbilt, was intensely technical in the first (steamboat) phase of his career. He captained and designed a lot of his own ships. In the second, railroad phase of his career, he was intensely financial, one of the first genuine masters of Wall Street. In both phases, he was something of a jerk. He had people skills, but they were of the sociopath-manipulator variety, not the empathetic variety. Rockefeller, another great historical CEO was more financial than technical, but he still knew the intricacies of oil technology inside out.

And it's only been getting more pronounced. Successful modern CEOs rely ever more on either technical or financial skills to inform their leadership.

Fast forward to today, and as a recent insightful post pointed out, even the "non-technical" members of famous founding pairs like Gates/Allen or Jobs/Wozniak have been extremely technical. They only looked non-technical compared to their even-more-technical partners. And with companies like Amazon, Google or Facebook, well, need I say more? (Bezos in particular is interesting, since he is among the rare CEOs who has both technology and finance skills).

Most leadership literature dismisses technical and financial skills as either unnecessary (i.e., delegateable) or something every candidate for the top job possesses, and therefore is not a meaningful differentiator. This is manifestly not true.

Equally, they like to pretend that people skills are absolutely essential. This again is demonstrably not true.

CEOs who lack both technical and financial skills (often those who rise up through the marketing or sales ranks for instance) rarely pull off bold strategic moves. If they are lucky, they cast the right people for roles around them to not mess things up, and steer a straight course in a strategically unsurprising direction. Wall Street loves them because they are so predictable and, in a stock-price-management sense, completely house-trained. They can be expected to play by the Wall Street quarterly-earnings rules without a whimper.

These CEOs are often greatly loved by employees and customers and are fantastic for morale and culture. Since people skills are the only skills they bring to the table, they exercise those skills to the hilt.

But Wall Street, employees and customers loving you does not equal a smart business. If a CEO is keeping all three constituencies happy, it means he/she is not actually doing his/her job. This is not a true leader, but an over-promoted manager-steward for easy times.

Equally, people skills are not necessary. Some of the most famous and effective CEOs have been (let's face it) complete jerks. In fact, jerkiness seems to correlate well with strategic boldness.